Sunday, December 1, 2013

Alaska Bar Rag Column for the September, 2013 Edition


Three Calendars and an Incomplete Set of Options

by Cliff Groh

Note:  This is an installment in a series of columns on the Ted Stevens case.

The Department of Justice was in an uncomfortable place with the Ted Stevens case in July of 2008, the month the indictment was handed down.    

The federal criminal investigation into the U.S. Senator’s conduct had gone on for more than two and a half years and produced a draft indictment focusing on charges of failure to report gifts and/or liabilities.   The probe had proceeded in fits and starts for more than a year, as the prosecution and defense had entered into a series of tolling agreements to extend the statute of limitations.   The motivations of course differed for the parties in making these agreements in which the defense waived the right to claim that one or more counts in a future indictment should be dismissed on statute of limitations grounds.   The prosecution was looking for more time to figure out how to proceed and to negotiate, while the defense was hoping use that time to persuade the prosecution to drop the case, perhaps with a referral to the Senate Ethics Committee.

Plea Negotiations Fail and Statute of Limitations Loom Large

The prosecution team was divided between Washington, D.C., and Anchorage, with the Alaska-based attorneys feeling out of touch with what was going on in D.C.    Thinking that the Stevens prosecution would not proceed, one of those Alaska-based prosecutors who had worked the most on the case—Assistant U.S. Attorney Joe Bottini—took on a high-profile capital murder prosecution.

Back in D.C., the prosecutor’s traditionally favorite method for resolving a case—the plea agreement—had not come together.    The Justice Department’s stick of a threatened felony indictment had not gotten Ted Stevens to plead guilty under a plea agreement, even when combined with the carrot of a guarantee of no jail time.  

Far from pleading out, Ted Stevens seemed to be feeling pretty good about his chances, fortified by a firm conviction that he had done nothing wrong and a strong legal defense team.    Representing Stevens was Brendan Sullivan—billing at a reported $1,000 per hour—and Williams & Connolly, probably the country’s premier white collar criminal defense firm.

Given that the more than 1,000 total pages in the autopsies of the Stevens prosecution focus on how failures in providing discovery led to its dismissal, writing about the motivations in the decision to indict is difficult and inherently speculative.   That said, three calendars seemed to complicate the Justice Department’s decision-making.  

The timeline that mattered officially was the statute of limitations.   The charges under consideration dealt mostly with the Senator’s failure to report as gifts or liabilities unrecompensed expenditures made by VECO and/or its long-time CEO Bill Allen to improve Ted Stevens’ official residence/vacation home in Girdwood, Alaska.  

Those expenditures in that multi-year renovation process at the structure Stevens called “the chalet” were front-loaded in that most of them occurred before 2002.   This meant that much of the conduct at issue was in a count most at risk under the statute of limitations (which for federal crimes would—absent a tolling agreement between the prosecution and the defense to extend the time period—run five years from the commission of the offense to the date the charge is brought).   This also meant that a tolling agreement (or a series of tolling agreements) was needed to keep alive the possibility of the prosecution bringing charges against the Senator for failure to report his receipt of those things of value without paying for them as either gifts or liabilities.   In July of 2008, another tolling agreement was needed to leave open the option of charging the Senator directly for the disclosure report he filed in May of 2002 for calendar year 2001.

Clock-Watching Election Day and Inauguration Day

Along with the statute of limitations, the other two calendars at play in this highly unusual case focused on November 4, 2008 (the day that Stevens stood for re-election for a seventh full term in the U.S. Senate, this time against a strong Democratic opponent) and on January 20, 2009 (the last day of the administration of President George W. Bush).

The imminence of the election made the Justice Department concerned about the political impact of the timing of any charges, as the Department’s guidelines required that no charges should be brought to affect any election.   The report of the Office of Professional Responsibility (“OPR”) on allegations of prosecutorial misconduct in the Stevens case notes that Brenda Morris, Principal Deputy Chief of the Justice Department’s Public Integrity Section, stated that line prosecutors had early on suggested that this issue be avoided by making Ted Stevens the first trial of the federal government’s Polar Pen probe into Alaska public corruption, which would have meant that his trial would have come in 2007.   Morris also stated that the higher-up who heard this pitch “was not comfortable with this approach and wanted to build momentum with other trials.”    

Ultimately, Matthew Friedrich, the Associate Attorney General in charge of the Criminal Division, made the call in July of 2008 to go ahead and seek an indictment of Stevens.   Operating with the approval of Attorney General Michael Mukasey, Friedrich decided not to enter into another tolling agreement to extend the agreement beyond the July 31 date previously agreed on.    Friedrich told OPR that his thinking was “[I]f we were going to move on this, we shouldn’t be doing this on say November 1st[.]”    

One of the line attorneys who would actually be “doing” the prosecution did not see the timing the way Associate Attorney General Friedrich did.   Lawyers for Assistant U.S. Attorney James Goeke told Henry Schuelke, the special counsel probing the prosecution, that for “some of the Department’s then highest ranking officials” the timing of the indictment was “possibly driven by exogenous political factors….”   

The chief lawyer for Goeke declined an opportunity to elaborate on that reference, but developments in the news separate from the four corners of the Stevens case file seemed to shape the actions of Justice Department brass.   Those “highest ranking officials” were new in their jobs and well aware of the limited time they would be in those jobs.   Mukasey had been Attorney General less than a year as of July of 2008, and Friedrich had then only been in his job for two months.    Both men had had to testify before Congress regarding the controversy over unusual political influences on the removal of U.S. Attorneys during the tenure of Alberto Gonzales, Mukasey’s predecessor as Attorney General.  

Known as a no-nonsense judge who had served in the 1970s as Chief of the Official Corruption Unit of the U.S. Attorney’s Office for the Manhattan-based Southern District of New York, Mukasey had a reputation for toughness on public corruption.   That reputation led one commentator to note in September of 2007 that Mukasey’s nomination as Attorney General was probably bad news for Ted Stevens, whose Girdwood home had already been searched that July by federal agents.   In a speech delivered in March of 2008 that cited the Justice Department’s Polar Pen probe, Mukasey said that “We have and we carry out a duty to ensure that the Department’s investigations of public corruption are conducted without fear or favor, and utterly without regard to the political affiliation of a particular public official…. Let me be clear: Politics has no role in the investigation or prosecution of political corruption or any other criminal offense….”

In practice, wrote New Yorker writer Jeffrey Toobin, the constraints on Mukasey created by the circumstances of his arrival as Attorney General meant that he “was more or less obligated to defer to the judgments of career prosecutors like [Nicholas Marsh of the Public Integrity Section].  If the leaders of the Justice Department had been more politically secure, they might have asked harder questions about whether the facts justified the criminal charges against Stevens.”

Another factor loomed—the rapidly approaching end of George W. Bush’s presidency.   It is not just that politically appointed superiors always have less power over career professionals at the end of an administration; political cycles can have effect in another way.   "One of the things that happens in a political or high-profile case like this is that there’s a huge push to get it done before a change in the administration," a former prosecutor told writer Steven Andersen in an article about the collapse of the Stevens case appearing in InsideCounsel magazine in 2009.   “As government lawyers think about re-entering the private sector at the end of an administration, they want to leave a mark with a big case.”

A Constricted Set of Choices

Setting aside the various possible motivations for charging Stevens (including the belief apparently shared by the line prosecutors that the facts and the law justified an indictment), it seems that Matthew Friedrich unjustifiably limited the options he considered in July of 2008.   The man in charge of making the final call on the indictment seemed to see three choices:

1.   Indict Ted Stevens immediately on more serious charges of accepting bribes or honest-services fraud;

2.   Indict Ted Stevens immediately on less serious charges of failure to disclose gifts and/or liabilities; or

3.   Not indict Ted Stevens

With the Justice Department having squelched line prosecutors’ push for 
option (1), Friedrich appeared to think that option (2) was the moderate middle ground and thus the “safe” choice.   The choice of "Wait to indict Ted Stevens until we are more organized and prepared" did not seem to come up.   Granted, absent another extended tolling agreement with the defense that would run for some months—even to a date after the election in November of 2008—waiting to indict would have meant that the indictment could not have directly charged the Senator with failure to report the bulk of the allegedly unreported expenditures.    But the prosecution would still have had the benefit of the low reporting threshold—never more than $305 per year for the relevant time period—as well as the ability to get the evidence of uncharged crimes before the jury.  

Instead of taking this course, Friedrich and his chief deputy Rita Glavin seemed to think that success could be secured for the prosecution by pouring the special sauce of Brenda Morris over the case.   

Next:   Brenda Morris takes first chair and the miscalculation over the Speech and Debate Clause

Cliff Groh is an Anchorage lawyer and writer who has worked as both a prosecutor and a criminal defense attorney.   He has blogged about the “POLAR PEN” federal probe into Alaska public corruption for years at, which in its entry for May 14, 2012 features an expanded and updated list of disclosures.    Groh’s analysis regarding the Ted Stevens case has appeared in media as diverse as C-SPAN, the Los Angeles Times, Alaska Dispatch, the Anchorage Daily News, and the Anchorage Press.    The lifelong Alaskan covered the five-week Ted Stevens trial in person in Washington, D.C. in the fall of 2008.   He welcomes your bouquets, brickbats, tips, and questions at